The Government’s policy of reducing social housing rents will cost Southend Council £9million and ‘severely hamper’ its ability to build new homes, politicians warn.

The authority commissioned a report in the wake of the Tory Government announcing that rents will go down by one per cent every year to 2020, as well as developers being told to scrap affordable homes obligations to focus on ‘starter homes’ instead.

While tenants look set to pay £12 less from their average weekly rent by 2020, officers estimate the authority will lose out of £9.1million that otherwise would have been re-invested, meaning the council’s ability to take part in major refurbishment and build new homes is ‘severely hampered’.

But for tenants on housing benefit, they will see no difference as the Tories have proposed welfare cuts too.

In addition, the Government’s idea to scrap affordable homes, usually 30 per cent of any major development, and replace them with the obligation to build ‘starter homes’, will create even less property for the 1,600 residents on the council’s waiting list, the report warns. 1,699.

These ‘starter homes’ will be sold for a maximum of £250,000 outside London.

Labour’s David Norman, councillor responsible for housing, said: ““Although rent reduction looks like good news for tenants, for the 75 per cent that are on housing benefit it will make no difference at all, and as I said it will severely dent our funds to build the new affordable homes that Southend-on-Sea so desperately needs.”

Since the Government handed over housing stock to councils to run itself, rents have gone up in line with a formula, with council housing effect becoming self-sufficient under the Housing Revenue Account. (HRA) A project, funded by HRA money, affordable homes cash, and other development money, will create up to 27 new council houses on derelict land in Shoebury, but this could be the last of that type of building for a while when the new proposals come in during April next year.

And the Government has said that if high value social housing falls vacant, housing associations have the opportunity to buy it up, similar to Right to Buy legislation.

The authority believes that leaves 341 properties vulnerable.

But Sharon O’Reilly (corr), the chairman of Southend Tenants and Residents Association, said: “It is good news for tenants but the council need to work out where they make cutbacks, and not at the expense of residents.

“The rent rises in recent years have been unnecessary.”

Castle Point Council says its HRA will be affected by losing out on £2.6million, which threatens its ‘overall viability’, but Basildon Council has yet to assess the situation.

But council house tenant Dave Murray, of Rowenhall, Laindon, said: ““It’s a sugar coated pill that will further dismantle social housing and leave people at the mercy of the predatory private sector.

The Government should be compensating local councils for losing out on housing money.

“it is hypocritical – they should be tightening controls on private sector rents as an emergency measure until they get more social housing in steam.

“The Government should be compensating local councils for losing out on housing money.”






 Tim Sneller, from Southend Against the Cuts

“Obviously, we don’t welcome anything that makes it harder to provide council housing.

“Our point of view is that anything in effect hampers councils from providing social housing, because it is not subsidised, so should be welcomed whatever the impact on the individual tenant.

“The Government’s policies harm the provision of social housing, rather than increase it.

“There is another issue with availability with the Government’s policies on Right to Buy for housing associations, which will come in the way of providing homes for people.

“Social housing is still under attack.”



Council house tenant Rose Chapman, of Quantock, in Queensway

“I think it is wonderful they are doing this, I would like them to start it tomorrow if they could.

“I think what we pay is very reasonable anyway. My rent is £97.48 per week, but I live with my partner so we halve that amount.

“I know rent has gone up each year, but I haven’t found it difficult. Perhaps if I lived on my own I would have, and I’m sure they would have told me to move into a one bedroom flat.

“But my partner gave up his and moved in here.

“It will certainly help having less rent to pay over the next four years.”


In numbers: Southend council house rents

  • £12.76 - The average amount residents will pay less by 2020 per week
  • £87.41 – The average weekly rent in 2015
  • £9.1million – The cumulative loss from the Housing Revenue Account by 2020
  • 27 – up to 27 new council homes are set to be built in Shoebury
  • 1,699 – Number of people on the council’s social housing waiting list (as of 11th Nov)
  • 341 – the number of council houses the council believes to be ‘high value’